Over the past month, the average price of petrol has risen 1.8p to 131.32p while diesel has gone up by 2p a litre to 134.35p.

Supermarkets are now averaging 128.1p a litre for petrol, while oil company and other retailers average £132.7p.

But a strengthening pound and falling refining margins should force a correction in pump prices providing retailers choose to pass on the savings, the AA says.

Luke Bosdet, the AA’s fuel price spokesman, says: “Drivers were told earlier this month that there was ‘no end in sight’ to rising pump prices. Now, they should be looking for a £1.50-a-tank cut in petrol costs.

“The key question is to what extent and how quickly the fuel retailers decide to pass on the savings. In the past, such a significant drop in wholesale prices would have triggered a pump price battle among the supermarkets. For the moment, drivers should keep an eye out for competitive oil company sites taking the opportunity to undercut expensive supermarket sites.”

There is growing speculation that the fuel duty freeze that has been in place for the past eight years could be scrapped in this year’s budget.

Earlier this month, Chancellor Philip Hammond told MPs that previous analysis showing the benefits of the freeze on fuel duty against tax losses would “have to be looked at again in the context of the economy today".

Comments

Submitted by Contax on 29 September 2018

In reply to by anonymous_stub (not verified)

I read that diesel may not come down just petrol, sounds like another fix as more people use petrol due to less diesel vehicles so less demand for diesel should bring the price down, it all comes from the same oil. I guess there is a fix somewhere to try to punish diesel users which will never end.

Not seen it yet - and 3p/L off wholesale must surely mean 3.6p/L off the pump price because of the 20% VAT effect on top?I'd be more interested in seeing the supermarket price gap between petrol and diesel reduced - it's been obvious to me for a decade or more that they subsidise petrol with diesel, meaning that they can headline an exceptionally low petrol price without it hurting their bottom line. For evidence, look at the typical price gap between petrol and diesel at non-supermarket retailers - I see 2p/L gap currently, but supermarkets seem to be maintaining a 4p/L gap (and it was 5p until very recently). It's nothing short of a total con - and it works even better for them because they sell more diesel than petrol anyway.